A party seeking to set aside a judgment-in-default must prove both a lack of inordinate delay and merit in its defense.

Introduction

[1] This is the Defendant's application dated 10 November 2022 in encl 8 inter alia to set aside the judgment-in-default ("JID") of appearance dated 15 December 2021 entered against it.

[2] As a brief background, the Plaintiff and the Defendant are subsidiaries of and wholly owned by Stone Master Corporation Berhad ("SMCB"), a public listed company. The Plaintiff is a company dealing with supplying, selling and delivering tiles. The Defendant was one of the Plaintiff's customers. The last transaction between them was on 30 September 2016 where the Defendant owed the Plaintiff a sum of RM1,124,136.47 ("Debt").

[3] In September 2019, a settlement was reached between them where the Defendant via a letter issued on 3 September 2019 agreeing to pay the Debt by way of 4 instalments as follows:

(a) RM250,000.00 to be paid before/on 1 March 2020;

(b) RM250,000.00 to be paid before/on 1 September 2020;

(c) RM250,000.00 to be paid before/on 1 March 2021; and

(d) RM374,136.47 to be paid before/on 1 September 2021.

[4] SMCB was wound up on 27 February 2020 vide the Kuala Lumpur High Court Winding Up Petition No WA-28NCC-1233-011/2020.

[5] As the Defendant failed to pay the Debt despite numerous demands issued by the Plaintiff's solicitors, on 12 October 2021 the Plaintiff filed the Writ and Statement of Claim against the Defendant for recovering the Debt.

[6] A personal service of the Writ and Statement of Claim was done to the Defendant on 20 October 2021 and an affidavit of service was filed by the Plaintiff on 5 November 2021.

[7] The Certificate of Non-appearance was filed on 5 November 2021 and a JID was entered against the Defendant on 5 December 2021.

[8] The Defendant was wound up on 22 February 2022 vide the Seremban High Court Winding Up Petition No NA-28NCC-39-11/2021.

[9] Almost a year after the JID was entered, on 13 November 2022 the Defendant filed a notice of application as to extend the time of filing the application and to set aside the JID on the following grounds:

(a) the service of the Writ and Statement of Claim was irregular as it was done at the registered address of the Defendant which was the address of the then Defendant's company secretary by the name of Low Eng Tack;

(b) the JID was obtained by way of conspiracy to defraud the Defendant perpetrated by Foo Chooi Wai, Ong Kow Ee @ Ong Chiow Chuen, Tay Ah Tai and Low Eng Tack who allowed the JID be entered against the Defendant; and

(c) the Defendant denied the Debt as there was no reason for it to purchase the alleged tiles from the Plaintiff. The Plaintiff was an associate company of the Defendant and both are subsidiaries of and fully owned by SMCB.

[10] The Plaintiff in opposing the Defendant's application stated the following grounds:

(a) there was inordinate delay in the Defendant's application and no reasonable explanation given by the Defendant on the delay;

(b) there was no irregularity in the service of the Writ and Statement of Claim; and

(c) the Defendant has no defence of merit.

Whether There Was Inordinate Delay By The Defendant

[11] O 42 r 13 of the Rules of 2012 (" ROC ") requires that any application to set aside an order or judgment must be made within 30 days from the receipt of the order or judgment by the affected party. The provision says:

Setting aside or varying judgment and orders (O 42, r 13)

13. Save as otherwise provided in these Rules, where provisions are made in these Rules for the setting aside or varying of any order or judgment, a party intending to set aside or to vary such order or judgment shall make an application to the Court and serve it on the